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British Steel says 400 job cuts 'unavoidable'

Fri, 14th Sep 2018 11:37

(Sharecast News) - British Steel could cut up to 10% of its workforce as part of a turnaround plan as the business looks to try and keep up with the changes in the industry including the rising costs that come with a weaker pound.

Of a current 5,000 global staff, the company could layoff up to 400 workers from their managerial and administrative roles across the British Steel's UK, Irish, French and Netherlands operations.

The firm said in July its turnaround plan was "firmly on track" and that its annual sales had risen by £200m to £1.4bn and profits were up 50% to £68m.

CEO Roland Junck said the company would continue with a £170m investment plan and the 400 losses were unavoidable.

He said: "The pace of change we need in this challenging industry requires further and continued investment along with more agile and efficient operations.

"To help us achieve this, we have to make difficult decisions and our plans unfortunately include the proposed reduction of 400 roles across our global workforce."

Gerald Reichmann, British Steel's chief financial officer, says sterling's weakness against the US dollar since 2016 is one factor behind today's job cuts.

"We've made a strong start to life as British Steel but our external environment is constantly changing. For example, raw materials are all traded in US dollars, so the weakening of the pound and euro have implications for us. Like any business we need to be able to flex and adapt to these changes," he said.

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